Raymond gains 7% as BSE, NSE give nod to demerger & listing of realty biz

Raymond shares gained 7.1 per cent in morning deals on Friday and clocked an intraday high of Rs 1,528.9 per share on BSE. The stock climbed after bourses gave a 'no objection' letter to the company for scheme of arrangement between the company and Raymond Realty.

 

Around 10:27 AM, Raymond shares were up 5.67 percent at Rs 1,507.4 per share on BSE. In comparison, the BSE Sensex was up 0.73 per cent at 77,720.49. The market capitalisation of the company stood at Rs 10,035.32 crore. The 52-week high of the company was at Rs 3,493 per share and 52-week low of the company was at Rs 1,412.05 per share.

 

 

"We would like to inform you that BSE and NSE, vide their letters dated November 21, 2024, have issued their Observation Letters as required under Regulation 37 of the Listing Regulations with ‘No adverse observation/ No objection’, to the proposed Scheme. Copies of observation letter of NSE and BSE are attached herewith for your reference and record," the filing read. 

 

This development comes after, on July 4, 2024, Raymond's board of directors approved the demerger of Raymond and Raymond Realty Limited. 

 

Raymond announced the vertical demerger of its Real Estate Business into its subsidiary, Raymond Realty. Upon completion of the demerger, Raymond Ltd and Raymond Realty will operate as separate listed entities within the Raymond Group. 

 

The new entity will seek listing on stock exchanges and according to the scheme of arrangement, each Raymond shareholder will receive 1 share of Raymond Realty for every 1 share held in Raymond Limited.

 

As per the filing, the demerger was proposed as Raymond's Real Estate Business reported revenue of Rs 1,593 crore which implies 43 per cent year-on-year (Y-o-Y) growth and earnings before interest, taxes, depreciation, and amortisation (Ebitda) of Rs 370 crore in FY24, positioning it well to chart its growth path as a separate entity. 

 

Raymond Realty has around 100 acres of land in Thane with 11.4 mn sq ft Real Estate Regulatory Authority (RERA) approved carpet area of which about 40 acres is currently under development. 

 

"Having stated that now we have clear three vectors of growth at Raymond Group i.e. Lifestyle, Real Estate, and Engineering, this corporate action is in line with creating shareholder value creation. This strategy to demerge the Real Estate business into a separate company that will be listed through an automatic route is another step to enhance the shareholder value. The existing shareholders of Raymond Limited will get the shares in the newly listed Real Estate company in a ratio of 1:1," said Gautam Hari Singhania, chairman & managing director, Raymond Ltd.

 

In the past one year, Raymond shares have lost 15 per cent against Sensex's rise of 17 per cent.